Special bonds will help China's local governments purchase commercial housing for use as government-subsidized homes, said an official with the country's Ministry of Finance (MOF) on Thursday in Beijing.
The bonds, announced earlier this year as a support mechanism for affordable housing, are part of the Chinese government's broad-reaching efforts to promote stability in the country's real estate market.
During a press conference, Song Qichao, assistant minister of finance, clarified that the ministry will support local governments in collaborating with land-owning enterprises to determine acquisition prices based on actual conditions, manage the debt relationships involved in reclaiming existing land reserves, and define the contents and scope of special bond projects.
"We support local governments in using special bonds to purchase existing commercial housing for use as government-subsidized housing. This policy is mainly decided and voluntarily implemented by local governments, following the principle of rule of law and operating in a market-oriented manner. While ensuring a balanced financing return for projects, local governments can allocate special bonds to acquire existing commercial housing for use as government-subsidized housing," said Song.
The ministry will also work to improve the efficiency of land resource utilization and the efficiency of bond funds, he said.
"This policy will work together with other relevant support policies to further broaden local funding sources. It will not only use the existing housing stock effectively and promote supply-demand balance, but facilitate the optimization of new housing and increase of government-subsidized housing through multiple channels," said Song.
China to support local governments in buying homes for subsidized housing: official
